The spectacle of our federal government this fall
struggling to fund its operations and pay its bills is
only the latest bit of strangeness in what has been
a strange time for our country.

The economy has been statistically out of recession for more than four years, yet a majority
of households say we are still in a downturn. The
Consumer Confidence Index has been rebounding from a low of 45 at the depth of the recession
to a figure of 80. But 100 is the point at which
more than half of the population says the country
is heading in the right direction.

The August unemployment rate of 7. 3 percent
is an improvement from the rate of nearly 10 percent a few years ago, with 7 million jobs added
in the past three years. Still, the economy shed

8 million jobs during
the downturn and even
today, the employment
rate remains stuck at a
low of 59 percent.

The housing market
and stocks have been
among the bright spots.

Rising home prices have
pushed up net equity
holdings by $2 trillion
in the past couple of years and stock gains have
helped push total household worth to an all-time
high, although that wealth is heavily concentrated
in a small percentage of the population.

The most telling evidence of the contradictory
nature of our times is reflected in the net worth
of home owners versus renters. On average, home
owners have a median worth of nearly $200,000,
while renters are essentially living paycheck to
paycheck, with only $4,000 in net worth on average. And renters as a share of households are
growing; their ranks having risen by 6 million
from a decade ago.

So, we are living in the strangest of times. Let’s
see if 2014 brings us more of the same or something di;erent. W

ECONOMY

INSIDE VIEW

Learn what the latest
economic indicators mean for
the real estate industry.
http://economists
outlook.blogs.realtor.org
Lawrence Yun is chief
economist of the NATIONAL
ASSOCIATION OF REALTORS®.

Existing-home sales is a seasonally adjusted annual rate, which is
the actual rate of sales for the month, multiplied by 12 and adjusted
for seasonal sales di;erences. Pending home sales is an index that
measures housing contract activity. An index of 100 is equal to the
level of activity during 2001, the benchmark year. Price indicates
the national median. Inventory measures the number of existing
homes on the market at the end of the month. Buyer and seller
tra;c, current conditions, six-month expectations, and time
on market derive from a monthly REALTOR® Confidence Index. Results for August are based on 3,171 responses to 6,000 surveys sent
to large and small real estate o;ces. The survey asks practitioners
to indicate whether conditions are strong (100 points), moderate
(50), or weak (0). Some data may be revised from previous issues.

107.7
(index)

5. 5
million

$212
thousand

2. 25
million

DAM READY TO BURST?
Growing disparity between number of young adults
living at home and those moving into home ownership
Source: NAR Research

30. 3
percent

36. 7
percent
62
(index)

44

65
(index)

On average, home owners

have a median net worth
of nearly $200,000,
while renters have only

$4,000 in net worth.

Market Pulse

Rising interest rates and continuing tight underwriting could
dampen sales as the year winds down. Still, 2013 sales will
be up significantly from 2012. Appreciation remains robust,
largely because of tight inventories. Interest rate concerns are
reducing practitioner confidence. One bright spot: pent-up
buyer demand by young households. As adults under 35
start to move out of their parents’ homes, home sales stand to
benefit. All trend lines are from August 2012 to August 2013.